Cruising after Brexit and sailing in Europe
Keeping a boat in Europe has offered easy adventure and warmer climates, but as regulations after Brexit begin to take…
Are you confused about the boat VAT rules in the UK and EU following Brexit? Yachting Monthly experts help to unravel what the new regulations post-Brexit mean for sailors
What are the exceptional circumstances to avoid paying boat VAT again?
It is clear that if a boat is exported from the UK or EU for more than 3 years then that boat will be subject to VAT upon its return, even if it is returned by the same owner to the same country as it left – except under exceptional circumstances.
What are those exceptional circumstances?
It seems that if you do a circumnavigation of greater than 3 years you are in for VAT upon return unless one can fit somehow into the exceptional circumstances!
Jeff Wrinch
The chair of the Cruising Association’s Regulations & Technical Service group, Robin Baron responds:
Jeff’s question is a good one.
To date HMRC has steadfastly refused to give guidance as to when they will regard ‘exceptional circumstances’ as applicable.
Informally they have indicated that the effect of COVID-19 restrictions may constitute exceptional circumstances.
In the EU the equivalent expression is ‘special circumstances’ and again there is currently no guidance.
Continues below…
Keeping a boat in Europe has offered easy adventure and warmer climates, but as regulations after Brexit begin to take…
Yachting Monthly experts help you unravel what the new regulations post-Brexit mean for UK and EU sailors
Marine organisations in the UK and EU have come together to release guidance on the EU VAT status of second…
Boat owners, whose vessels were in the EU at the end of the Brexit transition period, now have until 30…
Circumnavigators do indeed run the risk of having to pay VAT again but this is not a new rule and there has always been this risk for circumnavigators.
What is new is that the rule now applies on taking a boat out of the UK rather than the EU.
Keeping a boat in an EU country for more than 3 years now also triggers the risk.
If they are in the fortunate position of being able to have a new boat built in the UK or the EU for the circumnavigation they can export it immediately and thus defer payment of VAT until their return.
They will then pay VAT on the second hand value of the boat.
This is no help to owners of second hand VAT paid boats.
The CA is continuing to engage with HMRC and others to highlight the bizarre and unfair aspects of the UK VAT rules as applied to leisure vessels.
A subscription to Yachting Monthly magazine costs around 40% less than the cover price.
Print and digital editions are available through Magazines Direct – where you can also find the latest deals.
YM is packed with information to help you get the most from your time on the water.
Follow us on Facebook, Twitter and Instagram.
The post Brexit: What are the exceptional circumstances to avoid paying boat VAT again? appeared first on Yachting Monthly.